good morning. 8:00 a.m. at tesla in california, 11:00 a.m. on wall street. "squawk alley" is live. ♪

welcome to "squawk alley" for a thursday. joining us henry blojette founder and ceo of business insider, kayla tausche is out but jon fortt is here. good morning. interesting session setting up. stocks close to the highs on levels of the year on the hopes that europe gets a couple issue are sorted out. cisco earnings which we'll talk about. start with tesla, shares tumbling after the company reported a quarterly operating loss with fewer vehicle deliveries than analysts expected however ceo elon musk sounded pretty confident on the conference call last night. take a listen. >> if you take this year's revenue around $6 billion or thereabouts and if we're able to maintain a growth rate for ten years, and achieve a

profitability number, and have a 20 p/e our monthly cap would be basically the same as apple's today. >> henry, i have to know what you thought about his ambitions, right, and the capability of investors to keep up and have patience for the ambitions. >> tesla has always been a future story. you have to believe in lots of things that are way too far out to sea now going right to justify the price. that is some heroic analysis that elon brought to the table here. he's good. ceos talk about the long-term vision, what they can be worth, that's promming. apple generates $45 billion a year of profit, so to have apple's market cap you have to come up with a scenario where tesla generates $45 billion a year profit. $6 billion of revenue this year. there is a ways to go. if you assume a couple thousand dollars per car, you have to sell lots of cars to get to $45

billion of after tax profit. >> i'm amazed the same ceo who told us the price was pretty expensive. like he only deals in polar opposites. >> i wonder if this commentary was for irps or employees. we hear vfof the talent wars of apple an tesla. tesla has poached a bunch of quality employees from apple and rumors apple is trying to do from tesla right now. is he trying to recruit people? saying we've got a lot of promise going forward, i'm excited about this and that's the mode he's in. >> cramer this morning basically called them delorean, right. fine car, people who drive it love it. doesn't mean they're necessarily going to grow the way they expect or i guess in de lor yan's case be around. today jpmorgan takes it to an underweight. their argument is, a, they have ambitious goals in terms of growth, but it's not like mercedes or bmw are standing

still and they have dealerships you can test drive a car and walk away with one right away. >> absolutely. no question there's a demand issue here. even elon got close to saying i thunk demand is okay, if not, no worries i have a secret weapon. everyone has been concerned are they going to max out this market for all electric super high-end luxury and with oil prices cratering the other thing people aren't talking about. >> you don't think there's a tesla/gas price correlation. >> without question. sure. people going in. >> it's a $90,000 car. >> doesn't matter. before you could make this argument it's easier for the lines, you assumed gas is going to whatever, oil $500 a barrel everybody was predictioning six months ago. it becomes easier. i thinks there's no question and the key for tesla going forward really is they've got -- everything is banking on the mid-price car and for the mid-price car, especially, people will be looking at it. what's gas going to be in two years, is this a better economic decision, so i think there's no question that's factoring into

it. >> people in the valley still talk about musk like a visionary. >> as they should. >> really? >> it's great to see a ceo doing this. the fact that he's in his part time running a company shooting rockets into space, it's great he's thinking big and i love that he came out and said we are effectively going to spend a boat load. >> not a dividend, not buybacks. >> would be so much better off if more companies did that instead of sitting there maximizing every quarter, saying we're going to make a big bet on the future. love that. but that said, again, if you're going to think about the stock long term, you've got to think about what's the next product cycle that's going to drive it. i think there's no question that there is a demand issue here. >> move on to cisco, i know jon's got a lot on this. shares rallying a seven-year high after earnings and revenue topped estimates. best revenue growth in three years. the company upped its dividend by 2 cents to 21 cents and then john chambers joined cramer on "mad money" last night and talked about growth in europe. take a listen to this.

>> actually called it very accurate. i think europe is in a return state. it was minus 4% growth just a short time ago, four or six quarters ago. two quarters ago plus 2. this quarter plus. without russia into that number plus 9. >> up 11% in terms of switching revenue. it was a good quarter. >> really good quarter. we have to be careful how far out we extrapolate this. yes, they are coming off very strongly from different -- from easy comps i should say a year ago. yes, they've got strength in all these different businesses, especially unified communications systems, kind of their servers for the data center that have had amazing traction, done well, routing and switching coming back, but the longer term question is, you have these cloud powers like facebook, like amazon, like google emerging, they're turning into enormous buyers of these data center systems. intel has managed through its

intellectual property, chip manufacturing prowess still be strong on the data center market despite those folks rising. in the storage and server arena those folks are feeling pressure from big companies buying in mass that are able to exert different kinds of pressure. facebook yesterday came out and said they are working on networking technologies that they're going to freely give the blueprints to that will allow them to kind of change the game in networking. cisco tells me we're working closely with facebook, we're not worried about this, something we're used to dealing with but i think as an investor you have to have the question three years from now, do the facebooks of the world, and there are only a few of them, have the power to pressure cisco on the margins or has cisco figured out like intel seems to have at this point how to have the key intellectual property pieces to allow them to keep their margins and grow. >> the key question, hardware getting xhods tized value moving to the software layer, much cheaper. chambers was ebullient on the call.

we're going to crush them. great to see the optimism. if you step back you get context how hard things are in the enterprise world. john chambers jumping up and down and wall street jumping up and down for 7% growth. as we say where this is the acceleration, best quarter in thigh years, and best we can hope for, we have to have consolidation in enterprise, hardware and software. >> asking everybody, stuff written lately we're entering into an overbuilt in the cloud because rates are low, money cheap, is that a long-term danger and liability for guys like cisco? >> with high margins it's definitely something to worry about. the discount range changes long term. >> comparing it to the build out in 2000. >> i don't see it. and the reason why i don't see it, is i think what's happening is you're getting these big utility providers like your microsofts, facebooks again, amazons, googles that are buying this stuff instead of a bunch of individual companies buying it. they're going to have economies of scale. computing is becoming a utility type resource. are they overbuilding?

i don't think so. i mean think about how many different devices, different sensors will be connecting to the internet, internet of things. i hate that buzz phrase, but it's kind of true. there's going to be a lot of -- >> no question. if cisco can tie itself to that trend that's huge growth but we have to keep it in perspective, huge growth, single digits, maybe high single digits. >> what happens when you're 20 plus years old i guess. once again, talk about apple, the stock hitting another all-time high today, right now trading as you can see 126.83. the company's market cap, of course, over $700 billion. carl icahn thinks it could be worth. in a letter on his website, icahn thinks it's worth 216, margin cap worth more than $1 trillion, adding pinterest to help app discovery on the itunes store. lot going on, hard to keep up. >> we're going to dive more into that. i'm kind of skeptical on the pinterest partnership. pinterest is an interesting start-up company longer term but they don't have the scale of facebook, the amount of

information about a broad number of people to make app install type ads as big a deal, i don't think. apple is in an amazing place. it's an amazing company right now. the question, though, is, can they take this iphone mojo and transfer it to another product. it's hard. it didn't work so well with the ipad. we've seen that. can they do it with a watch, services like apple pay. we will a see. >> it's incredible difficult. i am a shareholder, very happy to see the stock going up. thrilled to see uncle carl coming out and talking his book with great detail. used to be the sell side that got held up as being fantastic assumptions and everything else. a major investor saying i think kite go here for these reasons. the concern i have and people should be a aware of, we are in the midst of a historic product cycle with the iphone. this product, there will not be another product that is as profitable as the iphone. where you have a subsidy -- >> dangerous words. >> will not happen. once-in-a-lifetime opportunity for apple, all the others. maybe the watch work.

little more skeptical than a lot of people are tremendously excited about it. the big thing to worry about, we've got two quarters here where we have the massive two-year catch-up in big screen iphone demand, with the required extra memory that drops another $200 to the bottom line with that and the bigger screen, what happens two quarters from now? does the 6s carry the wagon, the 7, will that make a difference. ultimately this is the iphone company right now. >> at least it has been, unless you think they will migrate into some -- morph into a services company you talked about. >> they will but that services beast it's huge for anybody else we would be sitting here gawking at the market cap of apple services business but relative to apple pretty small. >> the beauty of apple, or one of the beauties, they've managed to vertically it grate in so many ways from retail, chips, operating systems, the hardware down the line. it's possible they could pick up some more integration

possibilities there, whether it is in flash memory, whether it's in screens, whether it's in apple pay, yeah, more content, there are some things they could do to actually get more of the profit per sale. they have enormous brand loyalty. that's a lot of ifs. certainly no company has been better positioned in the time that i've been covering technology, 15 years plus or minus -- >> [ inaudible ]. >> it's a great company. and has been through this entire thing and one of the concerns around it such a religious following that you say anything even remotely unsuper positive qualifying -- >> you'll hear -- >> you get pelted with fruit your hater, you don't get it. it is a tremendous company. it's inspiring to watch. and hopefully that will continue. but, this product cycle going to end in a quarter or two and we have to know what's coming next. >> good to see you. >> great to be here. >> supposed to end a quarter or two ago. >> no, we had two big quarter of sales, we are in the second one. it's what happens after that that's the question.

>> henry, see you later. let's check in on the markets as you can see dow trading up 53 points. deal of the morning, of course, expedia buying orbitz for $12 a share in a deal worth more than $1.3 billion. rallying since the open. expedia and orbitz soaring so far today. shares of am ex after the company's merchant agreement with costco will end next year. amexhad been the only credit card accepted at costco stores. some discussion whether apple pay replaces it in some form down the line. >> costco is the only place we use our american express card regularly. it's like the reason why we kept it around. i wonder what amexdoes after this. i wonder do you get to use apple pay, are they going to take visa cards. do they do debit only? i don't know what costco does. from the consumer perspective this is a big deal to me. >> when we come back a meeting of the minds tomorrow as re/code's kara swisher sits down for an interview with none other than president obama. kara will joins us for a preview

in a moment. house of cards accidentally hitting the web two weeks early. netflix's response to frank underwood's early debut. amy ps paschal speaking out after being more or less fired from her post at sony. dow up 56. "squawk alley" continues in a moment. in my world, wall isn't a street. return on investment isn't the only return i'm looking forward to. for some, every dollar is earned with sweat, sacrifice, courage. which is why usaa is honored to help our members with everything from investing for retirement to saving for college. our commitment to current and former military members

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re/code's kara swisher set to sit down for an interview

with president obama tomorrow and joins us this morning from san francisco. kara, good morning to you. >> how are you doing? >> we were just discussing off air how many different questions you can pose to this president regarding tech. >> yeah. it's going to be a nine hour interview, 17 parts. >> what's first? >> i don't know. i was thinking about that. obviously the tensions between the administration and silicon valley over hacking, privacy, and a bunch of stuff i think is important and talk about where he stands as a digital president. he was promised as the digital president and how he look at his record. the sony hack recently he had a lot of opinions about that and where he sees countries fighting each other digitally. are these acts of war? i think it's an interesting question. whether he's going to create this consumer protection agency for digital. you know, a lot of things you can talk about and i'm interested in his own daily practices as a citizen and what he uses and the blackberry obsession, of course. there's always kinds of things you can ask him about. >> kara, how much should we read

into the fact that some pretty high-profile silicon valley ceos don't seem to be showing up to this cyber security summit. i'm wondering, given the pushback that a lot of them had, over the administration's treatment of technology companies, of the data that they have on consumers that the government wants access to, they don't want to turn over, does anybody feel like hey, this asking us to share all the security information, how do we know we can trust you, obama administration? >> well, i think that's definitely an issue in silicon valley and impact on business around the globe. other countries are acting because of the possibility of vulnerability. i think the idea of a snub, it sounds like you're all talking about a party in high school or something like that. these people have been around a lot at the white house and they've shown up and this is more of a cyber security summit so i'm not sure they would send their top people. they are sending their top cyber security people and tim cook is

there, and he's kind of running the most successful tech company, which is at odds with the obama administration about encryption on the smartphones. so he will be there to address the group. it will be interesting to see what he says and if he deals with that topic. >> also going to be interesting who will not be there. we're told mark zuckerberg, eric schmidt, larry page, "mad money," wmarissa mayer? >> we don't know. we're asking why that's the case. we've been to a lot of stuff with president obama and they should be there, but in lots of ways they have been to a lot of things. i don't think it's an attempt to create a snub. i tonight think that's the case. they're certainly sending people. it's a good question of the biggest names being there. tim cook is there. that's interesting. >> yes. government policy toward cyber attacks, hacking in one thing, title 2, net neutrality will be another one. you will probably break news there. >> we'll see. excuse me, we'll see. it's kind of an interesting --

there's so many topics you can talk about and i think this being a cyber security conference, i think these issues around this hacking to me is the most interesting part. there's net neutrality, there's, you know,s the changing nature of how people respond to government, there's the fallout from healthcare.gov, all kinds of issues around tech and the government that continues around immigration, i mean there's just endless questions you could ask him. >> and speaking of questions you could ask him, i guess you talked about cyber security, the increasingly kind of volatile nature of how that's being dealt with on a global stage. we certainly had all that. sony/nouk stunorth korea stuff talked about how much time do you expect to spend on that and the physical threats we have to deal with? >> it's interesting. are these acts of war? are they? the fact of the matter is we are hacking into other countries, a lot of the information in that "new york times" piece that they

got about why sony was being hacked from the north koreans came from we were hacking them. it's an interesting new battlefield. in actual physical battlefields the use of drones, very controversial, the use of people being in one country attacking other countries with physical weaponry, from far away is an interesting issue. i think it's a really question of what is an act of war anymore especially because digital can cause so much damage to a country's infrastructure and are we as a country ready to face possible, you know, sony hack was very serious, but there's more serious things around our infrastructure, around our water, and electricity and all kinds of things, are we ready that are becoming increasingly digitized are we ready to fend off these attacks. >> viewer saying kara's interview the only one i want to watch. >> oh, no. >> some say kara for president. >> no. >> and some say kara should ask him if he's seen "the interview". >> that's a good -- i think he has, but i think that's a great

question. and also selfies. kids with selfies, i don't know, so much to ask. >> we can't wait. we'll see you tomorrow. we'll be watching tomorrow that's for sure. >> thanks a lot. >> kara swisher at re/code. she will interview the president tomorrow. >> indeed. don't want to miss that. up next, amy pascal breaking her silence on the hacking scandal after more or less being fired from her post at sony. what she had to say in a moment. "squawk alley" is going to be right back. tomorrow. tomorrow. you total your brand new car. nobody's hurt,but there will still be pain. it comes when your insurance company says they'll only pay

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welcome back. in case you missed it amy pascal breaking her silence over the sony hacking scandal at the women in the world conference in san francisco last night. here was her reaction to having all of her e-mails available to the general public. take a listen. >> there was this horrible moment where i realized there was absolutely nothing at all that i could do about whether i had hurt people, whether i'd betrayed people, whether i'd

said things that i didn't mean. >> wow. she looks like she's just kind of letting it all loose there. it's interesting, she was asked about jennifer lawrence and carl, the information that she was paid less than her counterparts and she said believe me i've paid her a lot more since then. she also said here's the problem. i run a business. people want to work for less money i pay them less money. women shouldn't work for less money. they should know what they're worth. i thought that was interesting coming from here. >> that goes of nadella to some degree. it's interesting when people in the media find themselves covered by the media generally gives them a sense of what it's like these days. it's not easy. >> yeah. yes, indeed. but it's interesting having a woman in hollywood in the power position she was in saying, as a woman, if you're going to work for less money i'm going to pay you less. just coming come to the bargaining table prepared. you don't get freebies from her, i guess. >> interesting take. what day it's been, what a week it's been in europe. simon hobbs here wrapping up what we think we know right now

into take a look at this rally. this is a good rally across europe. often times we talk about southern europe how that's influencing policy. today it's coming from this side, from russia, with a deal they did on ukraine, minsk, you see the russian stock markets doing well and sweden, unexpectedly cut rates into negative territory. they have their own currency and they do a quantitative easing, $1.2 billion of public bond buying. that's kind of fed its way through. show you individual issues on that. the russian placement, we spoke about not just russia but ukraine, exposed to central and eastern europe. metro the german retailer, karlsburg, you know, and adidas have rallied and swedish stocks have done well today. in fact, we are at a record high on the swedish index on the surprise cut in interest rates. ericsson you'll note, one of the builders i was going to say insurers there, the other thing, good earnings in europe.

credit suisse has rocketed today. up 9%. r renault, and so the focus turns, of course, to greece. and today it was the leader summit. 28 heads of state from across the european union, not just the eurozone, the prime minister in the middle, his chance to convince the group if you like to side with him against what the germans are asking for. see him meeting angela merkel. people are noting the change in tone that we had between the greeks and germans. it was confrontational. that doesn't look confrontational. that sort of mood muse you can making some people think monday is a possibility of getting a deal. the atmosphere appears to have changed. the greek banks have had a great session as you can see. reuters is reporting that the european central bank had a teleconference today to discuss emergency liquidity assistance. remember they changed the rules so they kind of forced them into this emergency liquidity, they

could pull the plug but he won't for the time being. those stocks are doing well. it's the monday finance ministers meeting that people think we could get a deal on greece. yesterday they couldn't do a communique. the language is important. the greek don't want to say this is a continuation of where we are, to sell it at home they have to say it's something new. >> oh, no problem. >> thank you, simon. going to be a long weekend. when we come back president frank underwood making his netflix debut a little sooner than everybody planned. we'll take a look at the "house of cards" leak with the dow off of session highs. but what if you could see more of what you wanted to know? with fidelity's new active trader pro investing platform, the information that's important to you is all in one place, so finding more insight is easier. it's your idea

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hi, everyone. i'm sue herera. here's your news update. the democrats are heading to philadelphia. they have picked the city of brotherly love as the site of their 2016 convention. it would be held the week of july 25th. the economy starting the quarter on a soft note. consumer spending barely rose in january as households cut back on purchases in a range of goods. but the national retail federation in releasing its 2015 forecast, says retail sales will increase by 4.1% up from 3.5% in 2014. general motors says an electric car with a 200 mile range and a price tag of $37,500 will be built in a factory north of

detroit. the price does not include a 75 hnd federal tax credit. no one is eating cereal. kellogg's shares fol falling. the company struggling to juice up cereal sales. >> coming up fireeye chairman dave dewalt here on cnbc at 5:00 p.m. eastern. let's get back to "squawk alley." thank you, sue. welcome back to "squawk alley." joining us, jon steinberg, ceo of the daily mail north america. >> good to be here. >> talk apple, what do you say? another great day for the stock hitting an all-time high, the company announcing a new partnership with pinterest. it's in the form of a product, app pins that is a digital cork board for apps, pin different apps they want to save like pictures or recipe on the site. is this going to work? >> yes.

it's absolutely going to work. three quarters of all pinterest usage is on mobile right now. app discovery is a big issue, what people always say. hard for people to find what apps they want and kara swisher of re/code reported yesterday another app discovery datas base, raised $60 billion from alibaba, twitter and softbank. i think it's going to be great for pinterest and they will be able to do mobile app install ads the lucrative ads that facebook does on mobile as well. >> don't we know 90% of pinterest is female? >> certainly feels that way. i don't know if the number -- >> i think it's close. >> i'm on pinterest. >> i don't know if it's 70 or 90%. i play around with it now and then. i went on the boards they're using the sample boards that apple put up and about apps for design, apps for art and artistry which is a core way pinterest is used. leaning into what's already working on pinterest i would say. >> here is my question, though, is how much really good data does pinterest have not just

about purchase intent, people want to buy it, but what they want to install on their phones. they have a broad enough look at the sites people are visiting. >> yep. >> what their friends are doing that they can say we know you want to play candy crush or you might be interested in installing this blogging app versus just retail stuff. >> it actually doesn't matter that much because the apps are -- the app install ads are lucrative relative to display ads. i looked at this and said why are we not at daily mail making money off app install ads. if you're running these inside an app there is more data than doing them in mobile web. pinterest has very big ios apps with that app based data the ability to know more about a logged in user they should be able to get three, four, $5 cpms for the install ads as opposed to to $1 or $2 with a traditional display ad. it is leaning into data they're sitting on. >> certainly the price action this week has been remarkable although some of that arguably is about the promise of some distribution in april, you agree? it's not about pinterest and --

>> oh, no. this is tiny stuff. this is a big deal for pinterest. nothing thing for apple. for pinterest apple doesn't do that many things on the web, doesn't do that many web based partnerships. it's a huge endorsement they think pinterest is important to the ios ecosystem. private pinterest investor you're over the moon today. >> let's move on to twitter made news this week as well, ceo dick costolo making some waves at that goldman tech conference last night laying out plans to increase revenue, aiming for ads to make up about one in 20 tweets the average user sees and the company is, quote, well below that now. here we are back to the conversation we had about facebook, how much of an ad load can the user tolerate. jon? >> it seems dangerous to me in the same way that i kind of question this pinterest deal, not in principle, but just if they don't have the right data to know what you're interested in, those ads become a nuisance and then that can affect engagement and you don't want that to happen. >> let's talk about even the bigger thing related to making

those ads useful. they bought the company called niche started by rob fishman. we bought his prior company at buzzfeed as a matter of fact and i e-mailed him on monday because he runs sort of an on-line talent agency for vine stars. i e-mailed him monday and said i need vine as far as for a campaign. why is that? if you're a media company you're now in the idea business. i came here from a media agency about 20 minutes ago. the first thing they say to you when you walk into a room, what's your idea? what's what should we do with you? twitter is no doubt being asked the same questions when they walk into a room. what should we do on twitter. every cpg. they say not only do we have the ads we have niche, to bring alls the vine stars, we can bring all these stars that dos these different moving around type fast things in five seconds. they're bringing creative services to bear, that's what it takes to win business now. >> creative services. you know what a lot of vines are, right? >> yes. >> six seconds of a teenager bumping, walking into a wall. >> but people do stop frame animation as well too. ultimately it will be broader. they have video too.

you have to have some content in an ad. you need somebody to create that. the media agencies are now more powerful than ever. the creative agencies have not quite figured this out yet. they still want to make 30-second tv commercials. >> my own take, i think arguably twitter ignored vine a little bit too much, at least took some time in terms of really goosing it. this was the first demonstration they're getting serious in a public setting anyway. >> yes. and not only that, this is the first kind of indication that they're serious about winning giant orders. they can walk into someone now and say, let's do a 10 or $20 million type engagement. we will create all the content. we have the people in house now that are good at creating advertising content that works on twitter and vine. so i think it's a natural thing. it's a smart, bold move because creative services have lower margin than just slinging ads but know this is what they need to do. >> it will be interesting to see how do you think we can measure whether this is working for them. are there any metrics they give where we will be able to see this or just going to have to ask good questions? >> we need the analysts on the

conference call to say, are you winning bigger orders and are yes seeing greater client satisfaction, larger order sizes as a result of this and winning new business as a result of that. hopefully we'll get people asking that on the call next quarter. >> stocks off the highs moved into the red as the broader market has come in just a bit. 48 bucks where it was earlier this morning is a far cry from 38 where it was ten days ago. >> yes. the sentiment has changed on it as well. he did say at the conference he thinks logged out users could be worth $2.50. everybody has been looking for what can they do with these people that don't want to log in, don't want to register. that was a positive sign as well. >> do you buy this logged out user argument any more than you might have a quarter or two ago? maybe it was just a quarter ago they first started pressing hard on this. is it sort of to make up for the fact that the core isn't growing as fast as it should or churning more than it should or real value focusing on it? >> my skreshgverdict will remai. one of the topics snapchat we're

a partner in snapchat one of the 11 publishers that puts content on there right now. they've created something people want to go to snapchat to consume media and content. the same thing is on twitter as well. what can you do for people that don't want to participate, that just want to use it as a consumption platform. i have to see what the they do. do they go into original content, create original content and things of that nature. >> see you soon. >> jon steinberg joining us from "daily mail." >> disappointing retail sales fueling a mystery. where is the gas money going? steve liesman joins us from dallas with a cnbc rapid update. hey, steve. >> carl, good morning. yeah, it's interesting to see how the market has been reacting to this news, unchanged and maybe it's because the gdp outlook is unchanged. despite the disappointing top line when you go down to look at the core sales number, it was below expectations but we're still on track for a 3% spending growth in the quarter. taking a look at the rapid update what you see is the

fourth quarter tracking still at 2%. obviously down from the 2.6% originally reported. the first quarter tracking at 2.8%. inside of that is a consumion number that's going to be in the $2.3% range that was in the fourth quarter but still a pretty healthy number. you can see in the retail details. the 9.3% decline, in gasoline station sales, but again some of the discretionary items were down. 2.6 on sporting goods, books and music stores, autos down 1%, and department stores down 0.7%. but economists were not really all that concerned. what they looked at was, some of the underlying fundamentals of the economy so joel narero saying consumer spending started off slowly not expected to last because of the better jobs numbers. over at credit suisse they're pointing out that these are nominal numbers that we're getting. we're not getting the inflation adjusted numbers, so they're saying inflation is falling sharply. the picture in real or inflation

adjusted terms will not be so bleak. so what about that mystery? where is the gas money going? well, taking that first answer there from credit suisse, perhaps spending is higher in inflation adjusted terms, perhaps consumers are saving some of it, perhaps going to debt payments and finally services are not reported here. as part of that optimism the national retail federation reporting today it still cease a strong or healthy retail year up 4.1%. i'll be talking to richard fisher the dallas it fed president later today. tune in for our interview with president fisher at 2:30 today. finally, jon, one sector that was up that i saved for you, electronics up 0.3%. bucking the general trend, jon. >> yes, indeed. thank you, steve liesman. we know what expedia is doing with its cash, it wants to buy orbitz. those stocks both soaring on the news. expedia's ceo weighs in on the

deal. rick santelli, what are you watching today? >> well, of course, we're going to continue to try to look into today's retail sales and the ultimate growth of the u.s. economy and maybe its slowed at the end of last year. we're also are going to weigh in on break evens. larry summers mentioned them with regard to handicapping future pricing issues. and last, i have to weigh in on tesla. just a little bit. i like cars. all after the break. [ female announcer ] who are we? we are the thinkers. the job jugglers. the up all-nighters. and the ones who turn ideas into action. we've made our passions our life's work. we strive for the moments where we can say, "i did it!" ♪ we are entrepreneurs who started it all... with a signature. legalzoom has helped start over 1 million businesses, turning dreamers into business owners. and we're here to help start yours.

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coming up at the top of the hour, ukraine, greece, apple, tesla, a travel deal. plus the former yahoo! interim ceo who says he'd pay jon stewart $100 million to send his product directly to consumers. could it work? you're going to hear from ross levinsohn live. cisco's ceos says they're back with a vengeance, are the traders buying into that? all coming up on the half. more of a conversation i just had with carl icahn about apple and that bigger buyback he's calling for, his price target, all that stuff. >> great. we'll be watching, scott. meanwhile an embarrassing technical glitch or a brilliant marketing stunt? for a few brief precious minutes last night the third season of "house of cards" was made available on netflix.com. the company quickly took down the episode saying, quote, due to a technology glitch some

underwood fans got a speak peak, that's their spelling not ours. he will be back on netflix on it february 27th. lots of people on twitter questioning was this a brilliant marketing stunt. could have been. i don't know. what do you think some. >> it would go counter to sort of the character of netflix, right? typically -- and they have had issues. the famous christmas eve streaming of a couple years ago. >> yeah. maybe they got kind of inspired by the "sports illustrated" cover and figured they would tease. >> hard to believe they felt that was necessarily. i think it's going to be a big hit in a couple weeks anyway. >> no question. >> we'll. >> to the cme group, rick santelli with the santelli exchange on a busy day. >> indeed, a busy day. i know there's a lot of talk about retail sales and some of the talk, of course, wants to dry try to look past certain issues. the issues i can't look past are as follows. down 0.8% in january, down 0.9% in december. worst performance since november and december of '08.

back to the crisis. yield, 1.96, well above 2% before the data. the markets reading this one correctly. keep in mind we saw 25,000 jump in jobless. some things that people just don't talk about enough, after the emergency extension of jobless benefits ended, what we have seen since are better jobs numbers, and, of course, lower initial claims numbers for the most part. now the real issue that we always talk about, jobs jobs jobs, are the wage components. no matter how you slice this, something obviously happened from those second and third quarter solid gdp numbers to where we're at now. and we're still debating whether we can reach 3% on gdp. certain things don't change. now back to exactly what motivates markets. larry summers on today talking at great length about break evens, five year tips versus nominal and looking at the difference in yields between our treasuries and tips. and coming up with inflation

outlook. where that falls short is justs the general assumption that pricing pressures are the major drivers of the long end which make that comparison or the middle of the curve in 5s and plenty of things like weak data and what's going on overseas in europe and their rates that maybe accounts for a large margin of the movement that has nothing to do with what pricing pressures may be five or ten years down the road on the break evens. now last but not least everybody is talking about tesla. i read a great book, i urge everybody to read it called "the powerhouse" by a gentleman named steve lee vine, we will try to get him as a guest, it talks about all the disappointments in battery break through in the last ten years. the current one something called graphing. tesla, elon musk, brilliant man. but until we get the battery break through, i mean break through, where the weight versus output and costs really changes your bet on tesla isn't a bet on a cool car, it's a bet on technology for batteries and it

really hasn't changed much in 100 years. that's your bet. back to you. >> yeah, thanks, rick. it is a big bet. meanwhile coming up orbitz finding a buyer in expedia. inside the deal with expedia's ceo next.

. the deal of the morning expedia wants to buy orbitz for $12 a share in a deal worth more than $1.6 billion including debt. simon hobbs spoke to the ceo earlier and joins us here at

post nine. >> orbitz as you know, jon, one of the smallest on-line travel agencies but its stock rocketed on the news that ceo had found a buyer. industry behemoth expedia agreeing to pay $12 a share in cash, expedia has 13 major brands to which dara khosrowshahi will now add the orbitz brand and orbitz own brands of cheap tickets, ebookers and hotel club. those three brands will be much more profitable now that he can give them access to expedia stockpile of hotel rooms and existing lodging relationships. orbitz ceo bonny harford managed to bring his business back to the brink with better technology and private label business running basically the back office, for example, amextravel and other ad hoc sites. some say he had no choice but to look for a buyer because effectively its core business was in decline withouts the market power of an expedia or priceline. >> we've got one of the broadest

global inventories out there and we think that the complement of that inventory to the orbitz loyalty program, the bank program orbitz has, will be a terrific combination. barney earned at expedia and he was a able to take those skills to orbitz and i think that team has done a lot with the smaller scale that they had, and we think that adding their capabilities is going to be just dynamite and we're pretty excited. >> there's been so much consolidation in the on-line travel agency arena and with two big players merging in expedia and priceline. dara khosrowshahi may claim 15 or 17 major brands depending on how you count them. he rejects the idea there's a lack of competition or the regulator should get involved. >> i think that to the way that we see the business, there are many more than two players. every single supplier out there

has a very strong supplier direct operations, millions of people are going directly to american airlines or going to hilton, directly. google is in the game, trip adviser, the meta players are in the game. we compete in a much larger segment in general and there's lots of competition for that top audience. and we think the orbitz brand add to our capabilities there, but this is a big industry with many more than two competitors which is why we think the regulators will allow the deal to happen. >> and you hear that argument time and time again because i said earlier,el in his book suggests those in the monopolistic situations argue they're fragmented. >> he did a deal three weeks ago. >> when we come back call it facebook meets espn. we'll explain in just a moment.

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beautiful shot there out west. social network facebook quietly unveiled facebook sports social desk today.

at the facebook sports summit in new york. the set was created to give facebook an on the screen platform at sports events. here's a picture of the desk unveiled today. three athletes taking part in live q&as with fans today they will post to their respective facebook page. looks like a little bit of a sports center environment. >> it does. the thing about this, that i can't get my head wrapped around, traditional media was supposed to be so tired, right, but when the social media folks and techs pile into content they make it look like your traditional desk. i mean -- >> yes. sort of what we're used to. >> yeah. not a spaceship. i don't know. >> absolutely. stock, you know, 76.15, has been bumping along more on the underside of the 50-day moving average than the top side, as social has been through a few different narratives especially this earnings season. >> overall it's held up well. i want to mention also in tech, inindividual ya last night up 7% today. the gaming pc business doing

really well for them. traditional gpu, the mobile, not doing as well. >> can't wait to hear what the judge found out from icahn regarding apple. that will be interesting coming up next. back to headquarters, scott wapner and the half. ♪ and welcome to the halftime show. meet our starting lineup, stephanie link is with us along with joe terranova, josh brown, pete najarian and michele caruso-cabrera is here. our game plan looks like this. funny money, the man that says he would give jon stewart $100 million a year to do "the daily show" is here live. is that comedy central or is ross levinsohn really serious? back with a vengeance. >> congratulations. you're still alive. >> yippy. >> cisco boss john chambers going bruce willis saying he's killing it now.